The total turnover of leading centralized crypto exchanges in February 2022 was about $1.5 trillion.
Analytical company CryptoCompare released a report on the results of a comparative study of centralized cryptocurrency exchanges (CEX). The main conclusions include the consolidation of crypto trading on several major trading platforms. The “top-tier” crypto exchanges increased their market share to 96% in February 2022, compared to 89% in August 2021.
In total, the researchers studied 159 CEXs, 79 of which were categorized as “top-tier,” and the remaining 80 were designated as “lower-tier” exchanges. CEXs were evaluated based on security, number of available assets, compliance with regulatory standards, KYC verification, etc. In accordance with these criteria, platforms were awarded a rating from AA to F. All exchanges rated B or higher were classified as “top-tier.”
However, only four exchanges received the highest rating AA:
- Binance;
- Coinbase;
- Gemini;
- Bitstamp.
During February 2022, the trading volume on “top-tier” exchanges was $1.5 trillion compared to $62 billion traded on “lower-tier” exchanges. According to analysts, cryptocurrency traders prefer platforms with lower risks.
Among other factors contributing to the consolidation of market participants, analysts highlighted mergers, acquisitions, and the closure of many platforms. So, since June 2019, 54 crypto exchanges have been shut down.
Analysts also single out a number of trends suggesting certain risks for a CEX:
- further growth of oligopoly levels;
- increasing political pressure;
- withdrawal of user funds from trading platform accounts.
The last point stands out in the report: more and more cryptocurrency users prefer to keep their assets off exchanges, which comes amid political pressure on CEXs from regulators.
